The Sacramento housing market in August 2025 is stabilizing rather than crashing. Rates remain elevated, inventory is up, and buyers are gaining leverage while sellers adjust expectations.
Mortgage Rates: Holding Steady, But Change May Be Ahead
As of late August 2025, 30-year fixed mortgage rates are averaging around 6.58%, while 15-year fixed rates sit near 5.69%.
Rates remain high compared to the pandemic-era lows, but with the Federal Reserve hinting at potential cuts, we may see relief for buyers in the coming months.
If rates decline, demand in the Sacramento real estate market could increase quickly.
Sacramento Home Prices and Market Trends
Prices & Sales
The median Sacramento home price in July 2025 is approximately $497,000 — down 2.6% year-over-year.
Homes are sitting on the market longer, averaging 26–44 days compared to just 17 days in 2024.
Inventory continues to rise, with nearly 40% of pending sales showing price reductions.
Regional Snapshot
Across Placer, El Dorado, and Yolo Counties, the average home price is around $638,000.
Many sellers are adjusting expectations as the market shifts away from the rapid appreciation seen in 2020–2022.
Sellers: Time to Get Real
For sellers, pricing strategy is everything. Overpricing leads to extended market time, multiple reductions, and fewer offers.
June 2025 was one of the slowest sales months in 25 years for the Sacramento region, reinforcing the need for realistic pricing.
Working with hyper-local agents who understand specific neighborhoods — whether East Sacramento, Arden, Folsom, or Elk Grove — is crucial for positioning the home accurately.
Buyers: More Leverage, Less Competition
For buyers, today's market offers meaningful opportunities with more inventory, longer days on market, and motivated sellers.
Price reductions and negotiations are becoming more common as sellers meet the market rather than set it.
This is not 2008. While values are softening, the market is stabilizing — not crashing.
Buyers who act before rates drop may secure stronger terms before competition returns.
Sacramento vs. Bay Area: Why Buyers Still Move Here
Sacramento continues to attract Bay Area buyers seeking affordability, space, and value.
Bay Area median home price: approximately $1.5M.
Sacramento median home price: approximately $589K.
The value gap keeps Sacramento competitive for remote workers, families, and investors.
Final Takeaways
For Sellers
- Price for today’s market, not 2021.
- Expect longer selling timelines.
- Lean on a hyper-local Realtor for strategy.
For Buyers
- More inventory means more choices.
- Longer DOM = stronger negotiating power.
- Don’t wait for a crash — it’s an adjustment, not 2008.
Bottom Line
The Sacramento housing market in 2025 is about realism and timing. Sellers must price competitively and rely on local expertise, while buyers can negotiate favorable terms in a softer market.
If mortgage rates drop, expect increased competition as demand rebounds.
Want a Neighborhood-Specific Update?
Whether you're in East Sacramento, Elk Grove, Folsom, or Roseville, market conditions can vary dramatically block-to-block.
Reach out for a personalized housing update tailored to your neighborhood.
FAQs
- Is the Sacramento market crashing in 2025?
- No. Prices are softening, inventory is rising, and competition has cooled — but the market is stabilizing, not crashing.
- Is 2025 a good time to buy in Sacramento?
- Yes for many buyers. Higher inventory and longer DOM provide leverage and negotiation power that wasn’t available during the boom years.
- Why do Bay Area buyers keep moving to Sacramento?
- Affordability. The value gap between Bay Area and Sacramento pricing continues to draw remote workers, families, and investors.
